Another Electricity Distribution Company Seeks Bidders to Acquire Majority Stake

The last date to submit the bids is January 15, 2020


The union territory of Dadra and Nagar Haveli and Daman and Diu has invited bids to acquire a 51% stake in its distribution company (DISCOM), responsible for the distribution and retail supply of electricity.

The last date to submit the bids is January 15, 2021, and the pre-bid meeting will take place on December 18, 2020. Interested bidders will have to submit an amount of ₹300 million (~$4.06 million) as the bid security amount.

This announcement comes even as the High Court of Punjab and Haryana issued a stay order on the Central Government’s proposal to privatize Chandigarh’s electricity distribution company.

The UT Powermen Union of Chandigarh had filed a petition with the court calling the move ‘unjust and illegal.’ The union had submitted that the move to privatize the engineering department’s electricity wing of the union territory of Chandigarh by selling 100% of its stakes was not sustainable. It cited a provision in the Electricity Act, 2003, which states that a power department or utility cannot be transferred to a private entity, leaving no stake or control of the government in it at all.

Last month, the Chandigarh Administration had issued a request for proposal inviting bidders to acquire its DISCOM. The move marked the beginning of the Indian government’s attempt to privatize the sector.

In July this year, Puducherry also opposed the central government’s proposal to privatize all DISCOMs in the country’s union territories.

All of this dates back to May 2020, when the center proposed privatizing all the DISCOMs in the union territories. DISCOMs in the union territories come under the central government’s administration while the respective state governments govern those in the states. The union territories include Andaman and Nicobar Islands, Chandigarh, Dadra and Nagar Haveli, and Daman and Diu, Delhi, Jammu and Kashmir, Lakshadweep, Ladakh, and Puducherry.

Following this announcement, Tata Power took over the management of the Central Electricity Supply Utility of Odisha (CESU) for the distribution and supply of power in Odisha’s five circles.